The debate over the classification of XRP continues to stir discussions within the cryptocurrency space. Recently, Eleanor Terrett, a journalist with FOX Business, offered insights on the U.S. Securities and Exchange Commission’s (SEC) stance regarding XRP in the context of exchange-traded fund (ETF) applications.
According to Terrett, the SEC has acknowledged ETF proposals that treat XRP as a commodity asset wrapped in a securities structure, similar to how Bitcoin (BTC) and Ethereum (ETH) have been treated in their respective ETF filings. However, this acknowledgment does not necessarily indicate the SEC’s official classification of XRP as a commodity.
The SEC’s recognition of these XRP-based ETF applications signals a shift in how the agency engages with digital assets. Terrett explained that although ETF sponsors use Bitcoin and Ethereum regulatory frameworks to submit XRP-based products, the classification does not constitute XRP as a commodity.
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The SEC now allows approval of ETFs that track Solana (SOL), Dogecoin (DOGE), and Cardano (ADA), even though these coins had initially been designated as securities under SEC regulation. The regulatory agency is willing to broaden the scope of electronic assets it regulates.
For those asking — here are my thoughts on the questions about whether the @SECGov has classified $XRP a commodity by way of the ETF acknowledgements. https://t.co/iSbvYskpi9
— Eleanor Terrett (@EleanorTerrett) February 15, 2025
Regulatory Uncertainty and Ongoing Litigation
XRP regulatory uncertainty continues to exist even after the SEC moved forward with processing ETF applications. According to Terrett, the SEC has put its legal cases on hold because its cryptocurrency task force needs time to evaluate regulatory standards.
The SEC demonstrates a prudent stance through this decision because it evaluates which category XRP and similar digital assets should fall under. A federal court in the U.S. decided in July 2023 that XRP stayed away from being security in second-market exchanges, yet the SEC continues to study the asset without settling its security designation.
Furthermore, the SEC’s decision to pause litigation reflects broader trends in the crypto space, where legal battles have influenced regulatory definitions of digital assets. As the SEC continues to review ETF applications, its actions may ultimately signal a shift in how it perceives XRP and similar assets.
In acknowledging XRP-related ETFs, the SEC may be trying to avoid the perception of favoritism. By considering a range of digital assets in ETF proposals, the SEC aims to present a more neutral stance, preventing claims of preferential treatment for specific cryptocurrencies.
However, until the agency more actively engages with these applications, the future regulatory status of XRP remains uncertain.
Conclusion
The SEC’s acknowledgment of XRP-based ETF applications is an important development, signaling a potential shift in how the agency may treat the digital asset in the future. However, it is essential to understand that this acknowledgment does not equate to an official classification of XRP as a commodity.
The evolving nature of cryptocurrency regulation and the SEC’s ongoing legal assessments indicate that XRP’s status will likely remain in flux.
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